Will Higher Rates and Tax Changes Derail Housing Market?

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Posted To: MND NewsWire

Last year’s Federal Reserve actions, raising the target interest rate three times, led to about a 0.75 percentage point increase in the 1-year Constant Maturity Treasury (CMT) note, while the 10-year CMT note barely moved. Freddie Mac’s Economic and Housing Research group says this flattening of the yield curve could be a bad sign for future economic growth . Especially should that curve become “inverted.” Freddie Mac says they don’t expect the trend to continue , instead they expect long-term rates will also follow the Federal Open Market Committee’s (FOMC’s) anticipated actions in 2018, for three or four more rate hikes , and head higher. Writing in the current edition of Outlook , the economists say the new Tax Cuts and Jobs Act bill’s lower corporate tax rate should boost GDP growth by…(read more)

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